Sign Of The Times Growing Dominance Of Pharmacy Chains May Signal End Of Corner Drugstores.

March 12, 1989|By LESLIE RUBINKOWSKI, Business Writer

Anyone who has been in a drugstore lately knows that the lazy days of the soda fountain and penny candy are mostly memory.

Pharmacies sell everything from Ben Gay to beef stew to blood pressure machines and stress everything from friendly service to convenience to rock- bottom prices.

In South Florida, the clamor of competing chains is louder than ever as the market grows and more chains gear up to enter or expand.

The three most dominant -- Rite Aid, Walgreens and Clearwater-based Eckerd -- continue to grow, by opening new stores or by acquiring smaller chains. Phar-Mor, a fast-growing, deep discount chain, has opened several South Florida stores in the last year as has Freddy`s, a cost-cutting unit of retail giant Melville Corp.

Some of the newest competitors aren`t even drugstores. Publix, like its rival Albertson`s, is putting pharmacies in some of its supermarkets. And Wal- Mart, the king of the discounters, will open several stores with pharmacies in Broward and Palm Beach counties this year.

Industry observers say growth of the three chains, which are among the nation`s biggest, plus other companies in the region makes shopping easier for area consumers.

But, they caution, the explosion makes it harder for the traditional independent drugstores to stay afloat.

``I would say the long-term trend is for chains to be taking more and more of the business and for more and more of the independents to be driven out of business,`` said Bruce Buckley, editor of the trade publication Drug Store News.

But some South Florida independents said it is possible to thrive amid the crush.

``Tenacity and service, service, service are the only thing an independent can give better than a chain,`` said Bobbi Oppenheimer, owner of the 72-year- old Schmidt`s Pharmacy in West Palm Beach. ``I don`t have to call headquarters every time I want to make a decision.``

Although drugstore struggles aren`t unique to Florida, many companies agree that Florida stands out from other national markets because of the huge waves of senior citizens, snowbirds and tourists that come to the region every year. That makes it irresistible to retailers.

``Certainly Fort Lauderdale is different in that customers have more shopping choices,`` said Maryellen Kari, spokeswoman at The Walgreen Co. in Deerfield, Ill. ``And in that sense we certainly have to be aware of meeting our customer`s needs.``

A company such as Walgreen, with 1,440 stores, can meet customers` needs around nearly every corner. Of the 100 stores nationwide that the company plans to open this year, 30 will be in Florida. The company already has 240 stores in the state -- 58 of them in Broward and Palm Beach counties.

Such size also makes it easier to buy stock in bulk, which keeps prices low, spend money on newspaper and TV ads and offer services the little guy can`t afford. Walgreens, for example, boasts weekly ad circulars, a computer system for prescriptions that links all of its stores -- and $4.88 billion in sales.

Eckerd Drug Stores operates 483 of its 1,580 drugstores in Florida. Its widely aired TV spots show Eckerd as a place where pharmacists are top-flight professionals who still find time to call every customer by name. The company had sales of $2.7 billion last year and filled 1 billion prescriptions.

Rite Aid, which has 2,171 stores nationwide, operates 63 of its 193 Florida pharmacies in Broward and Palm Beach counties. The chain offers blood pressure screenings and a 1,000-product line of private label non-prescription drugs and beauty aids.

``Because we`re such a large chain, our customers from the Midwest and Northeast come to Florida and look forward to shopping with us,`` said Suzanne Mead, assistant vice president of corporate communications for the chain based in Harrisburg, Pa.

Size also enables the big guys swallow the competition: In 1986, Rite Aid bought Gray Drug, adding 600 stores to its chain. Two years ago, Eckerd snapped up 35 South Florida stores from Shoppers Drug Mart, a Canadian chain that tried to adapt to U.S. drugstore techniques.

``It`s hard to compete against the big guys,`` said Joe Cote, a former Florida supervisor for Shoppers Drug Mart who now works for a real estate firm in Boca Raton.

But some smaller firms said they can make money by catering to customers in ways that big chains cannot.

Cunningham Drugs used to operate 200 stores nationwide. It went private and was sold off. In South Florida, former Cunningham executive James Devine purchased and is president of seven of those stores.

The pharmacies, which operate as Cunninghams and several other names, seldom advertise or brag about prices. The chain probably won`t expand beyond 15 stores. But it does offer free delivery and first-name service -- and President James Devine swears he hand-picks friendly people to work behind the counters.